“The amount of regulation tends to grow during periods of financial strain and we are certainly seeing that in the U.S.,” Immelt said, “The number of ‘major regulations’—regulations with more than $100 million in impact—has exploded in the last few years. The result has been an additional burden on business. Until we solve for these constraints, it is hard to see that the U.S. will return to its full growth potential.”

Hardly a glowing outlook.

Meanwhile, the stock was also downgraded by Nomura analyst Shannon O’Callaghan to Neutral from Buy. Callaghan maintained a $24 target price for the stock; the downgrade seems to be based more on valuation than anything else.

GE has made key positive steps in the last couple of years and sentiment has turned more positive. The P/E (adjusted for accounting differences) is now in line with premier industrial peers despite GE still getting 40-45% of its earnings from GE Capital. Given the valuation recovery we see more potential for outperformance elsewhere in our sector.

Add a Comment

We welcome thoughtful comments from readers. Please comply with our guidelines. Our blogs do not require the use of your real name.

Comment

There are 4 comments

MARCH 11, 2013 11:54 A.M.

max wrote:

Immelt is shifting the blame from himself to the government. Why not speak more specifically to the results and plans for your business instead of giving a lecture on the US government? Nonsense. Remind me to sell my shares. I see the market agrees with me.

MARCH 11, 2013 12:48 P.M.

bud u. wrote:

Immelt should have been fired long ago. Look at the 10 year chart. Pathetic. Any other major company would have removed him based on lack of performance. Did I mention he has picked up about $50,000,000 along the way??? What's in YOUR wallet???

MARCH 11, 2013 1:39 P.M.

j wrote:

Immelt is laughing all the way to the bank right behind Nardelli , Fuld and poor Jon Corzine and did I forget to mention Ron Johnson of JCP.. Wasn't Immelt on Obama job producing Commission? How many jobs did create.All these so called chiefs take advantage of the system.

MARCH 11, 2013 6:45 P.M.

Anonymous wrote:

There are way too many good news about GE. I strongly doubt that Nomura's downgrade is warranted. Time will tell.

About Stocks To Watch

Earnings reports, corporate strategies and analyst insights are all part of what moves stocks, and they’re all covered by the Stocks to Watch blog. We also look at macro issues, investor sentiments and hidden trends that are affecting the market. Stocks to Watch gives you the full picture of the U.S. stock markets, all day long.

The blog is written by Ben Levisohn, a former stock trader who has covered financial markets for the Wall Street Journal, Bloomberg and BusinessWeek.